New research from the University of St Andrews suggests that government attempts to tackle poverty and unemployment in Britain through neighbourhood renewal schemes are failing to target the right issues.

Many government urban neighbourhood and housing policies aim to create a socio-economically balanced mix of residents in an area, motivated by the idea that living in a deprived neighbourhood has a negative effect on the employment and life chances of the residents.

Using the Scottish Longitudinal Study (SLS), Dr Maarten van Ham and Dr David Manley from the Centre for Housing Research (CHR) at the University of St Andrews, showed that living in deprived neighbourhoods or living in neighbourhoods with a concentration of social housing, does not negatively influence labour market outcomes of neighbourhood residents.

Dr van Ham commented, “Creating neighbourhoods with a socio-economic mix of residents is a common strategy to tackle assumed negative neighbourhood effects.”

“It’s thought that mixed tenure neighbourhoods of both social renters and homeowners have positive effects on the poorest residents in deprived neighbourhoods, as homeowners are thought to provide positive role models.”

However, the study found that there is surprisingly little evidence that living in deprived neighbourhoods really affects individual life chances and concludes that policies should target individuals rather than the areas where they live.

“The fact that residents of deprived neighbourhoods are often unemployed is not caused by the fact they live there,” continued Dr van Ham. “Rather, they live in these areas because they have no options to live elsewhere.” This outcome has important implications for neighbourhood and employment policies.

Their study shows that creating mixed tenure neighbourhoods is unlikely to help individuals to get and keep a job. The research outcomes suggest that investing in people is likely to have better long term effects in improving people’s lives.

The effect of neighbourhood housing tenure mix on labour market outcomes: a longitudinal investigation of neighbourhood effects (Van Ham, M., and Manley, D. 2009) is published in the Journal of Economic Geography.